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It is very common for diamonds to be formed with slight imperfections. These are known as "inclusions" and can come in many forms, including tiny white points, dark dots, or feathery cracks. The fewer inclusions, the more the stone is worth. A diamond's clarity ranking is determined by the number, size, type and placement of the inclusions.

A stone with only a few hard-to-see pinpricks located near the edge, where they can be covered by the mounting, has better clarity than a stone with a crack located right under the table (the large top facet of the stone). Cracks from the surface to the interior are especially dangerous because the diamond could break if hit the wrong way. On the other hand, small nicks and chips on the surface are often of little concern because they can be polished away.

For the most part, diamonds used in jewelry are clean to the naked eye. In a certified diamond, the cracks are charted on the certificate and act as a fingerprint for identifying a particular stone.

The following is the GIA clarity scale, along with corresponding definitions for different clarity grades, which is very commonly used in the United States:

FL FLAWLESS Free from all inclusions or
blemishes at 10x magnification.
Flawless diamond
IF INTERNALLY FLAWLESS No inclusions visible at 10x,
insignificant surface blemishes.
Interally flawless diamond
MINOR INCLUSIONS Difficult to see face-up at 10x. Minor included diamond
NOTICEABLE INCLUSIONS Easy to see at 10x. Noticably included diamond
OBVIOUS INCLUSIONS Easily visible to unaided eye. Obviously included diamond